What is a target market
For most businesses, finding new customers is priority number one. However, most companies only have a vague idea of who they should be targeting and why. Understanding who your target market is, what motivates them, and how you can serve them will make it easier to win new customers.
A target market is the potential customers who need your services or products. They are the core of your customer base. These are the people who you as a business owner believe will benefit the most from your products or services. Understanding this group is essential for any marketing strategy, or business in general, to be successful.
Understanding your target market is more than just guesswork. It’s about understanding what motivates them and what problems you or your product solves for them. Age, income, education level and gender are valuable demographic information that helps you to better determine what your customer’s needs are. But this is just the beginning of learning about your target market.
Diving deeper can help you to fully understand who your ideal customers are as people. To reach this deeper level of understanding, you must get in the mind of your consumers. What lifestyle do they identify with? How do they spend their time? What excites them? What are they afraid of? Answering these types of questions will give you a clearer picture of how to best reach your target market and convert them into customers.
Determining your target market
Finding your target audience means knowing what problems your products and services solve, the competitive landscape, and more. It’s a lot of work, but with planning and strategy, defining your target market will radically improve your marketing and grow your business.
Here are some of the basics of determining your target market:
Understand what problems your product or service solves
Understanding the problem your business solves for your potential customer is central to earn their business. For example, if you own a farm-to-table, organic-only, meal prep and delivery service, your products would probably be attractive to someone who has a busy schedule and is concerned about their health. Going deeper, your business probably appeals to someone who also works out or lives an active lifestyle.
For this example, aspects of your target market may include higher-income adults, with demanding jobs that want the best food, but don’t have time to shop or cook.
Conduct market research
Market research will help you to understand the competitive landscape, understand how to reach new customers, and how to improve your business. Digital tools such as Google Trends give you a comprehensive look at popular keywords that your customers may use online while shopping.
Another great way to conduct market research is by analyzing data from your previous customers. How they found you, what they bought, and how long their decision process was is all valuable information that can be leveraged to bring in new customers.
Create customer profiles and market segments
Market segmentation is a process of taking all your customer data and organizing it into groups based on categories such as demographics, interests, behaviors, and so forth. This allows you to organize your marketing efforts based on actionable data and strategy and not guesswork. Customer data is useless without a proper strategy to utilize that information.
These organized groups can then become customer profiles; customer avatars that you intend to target with your marketing. Creating these avatars can help take abstract data and create a picture of who your marketing is targeting.
For example, instead of your data just being a list of attributes such as “millennial”, “dog-owner”, “college graduate”, you create a person to market to directly. Brandon, a 29-year old software engineer, enjoys taking his 3-year old German Shepherd to the dog parks near his old college dorm. Using your data to create a customer profile makes it easier to visualize how your products and services help your target market.